Investing in Sports: The New Frontier for Wealthy Family Offices
2025 is shaping up to be a landmark year for sports mergers and acquisitions. According to a recent survey by BNY Mellon, a striking one-third of ultra-wealthy investment firms are actively investing in sports. This trend signifies not only a shift in investment strategy but also reflects changing dynamics in how the ultra-rich perceive value in the sports industry.
Wealth and Sports: A Strategic Interconnection
Recent high-profile acquisitions, such as Guggenheim Partners CEO Mark Walter’s purchase of a majority stake in the Los Angeles Lakers for a staggering $10 billion, have grabbed headlines. However, these billionaire buyouts represent just the tip of the iceberg. Family offices are now diversifying their portfolios by investing in adjacent assets such as live-viewing venues and betting applications.
BNY Wealth’s Chief Investment Officer, Sinead Colton Grant, noted that family offices see investments in sports as a viable hedge against inflation. Beyond just owning equity stakes in teams, many wealthy investors are exploring various avenues in the sports ecosystem. “You’ve got media rights in addition to broader franchise interest. You’ve got real estate, like the broader complex around the stadium,” she explained, highlighting the multifaceted nature of sports investments.
The increasing appeal of sports-related assets can be attributed to lower barriers to entry. Investing in a strength-training app or a ski resort demands significantly less capital compared to purchasing a multibillion-dollar franchise. This opens the door for a broader range of investors, allowing for a more accessible entry into the lucrative sports market.
Targeting Niche Markets: Case Studies from High-Profile Investors
While many family offices adopt a broad investment strategy, some are honing in on niche markets. The Chaifetz Group, led by Richard Chaifetz of ComPsych, serves as a prime example. This Chicago-based family office has built a targeted portfolio around pickleball, owning both a team (the St. Louis Shock) and multiple companies within the rapidly growing sport, including Pickletile, which specializes in court construction.
Furthermore, billionaire David Blitzer is another notable figure in the realm of sports investments. As the first individual to hold equity in all five major men’s U.S. sports leagues, his interests extend to sports startups. This year alone, Blitzer has invested in ventures like Fantasy Life, a media firm focusing on sports betting, and Ballers, a chain of social clubs centered around racket sports. His insights underscore the growing value of sports teams: “They’re not making any more of them, and they’re growing,” he remarked, emphasizing the diminishing supply and emerging revenue streams in the market.
As family offices navigate the evolving sports investment landscape, they leverage strategic insights and economic indicators to inform their choices. The intersection of sports and investment offers a fertile ground for new opportunities, capitalizing on an engaged and expanding fan base eager to consume diverse offerings.
With a mix of strategic investment and market know-how, the ultra-rich are actively reshaping the sports industry. As trends like media rights and hospitality merge with traditional team ownership, it’s clear the future of sports investment is not just about owning the game but about being part of a holistic ecosystem poised for growth.